Airtel Kenya has locked horns with the local ICT watchdog, the Communications Authority of Kenya (CA) over the renewal of the operator’s operating permit. It seems that the matter has escalated because the troubled operator has taken the matter to the High Court. This marks the first instance in which details of the battle have been accessed by the media.
The matter can be traced back to 2013 when Airtel Kenya requested CA to lower its license renewal fees, which the telco argued was arrived at sans involving key stakeholders. Airtel had proposed to pay the amount according to its annual gross turnover that is against CA’s regulations where fixed fees are demanded for every service provider. Airtel argued that it was a small operator and was not in a position to cough up KES 2.1 billion in order to stay in business. In contrast, Safaricom had paid KES 2.3 billion to renew its license the year before.
In 2016, some of the ICT regulator’s leaders including the agency’s director-general Mr. Francis Wangusi and chairman Mr. Ngene Gituku mentioned that it was probable the CA’s demand to have Airtel pay up its operating licensing fees was motivated by board member(s) who wanted to be paid off in exchange for a favourable decision. It was also revealed that Treasury supported CA’s position to have Airtel pay what it owes for operations and frequency, citing that it had no powers to stop government revenue streams.
Airtel has since taken the matter to court to stop CA’s renewed pursuit to compel Airtel pay spectrum fees. However, Airtel maintains that CA had promised to combine the telco’s licenses with those that it acquired from Yu back in 2014.
Moreover, Airtel claims that its new licenses should last up to 2025 after paying a fee of KES 718 million for them in 2014. It is not understood why CA is asking for an additional KES 2.062 billion as a clause in renewing Airtel’s licenses.
“Once the payment in the sum of $6.975 million (Sh718 million) was made by Airtel to the CA, the only outstanding item was the finalization of the actual terms and conditions of the main operating licence which were discussed and concluded in February 2015,” says Airtel legal and regulatory affairs director Joy Nyaga in suit papers.
Remember, this is the same regulator that awarded Jamii Telecoms Limited (JTL) a 700 MHz frequency for KES 100,000. Telkom Kenya, Airtel and Safaricom paid KES 2.5 billion each for the same spectrum.
Airtel is faulting CA for failing to offer the telco with a new license bearing its branding.
“The CA’s decision is unreasonable since without a basis it contradicts and disregards the terms and conditions previously communicated to Airtel by the CA requiring the applicant to pay a sum of $6.976 million prior to its license being renewed,” Ms. Nyaga adds. The CA is yet to respond to the suit.
We will inform you how things will turn out.